Monday, June 09, 2008

Intellectual Property Exclusive News Agency.

Dear Readers,

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Snippets from the about us page of the website.

ag-IP-news Agency, is a pilot project that has been exclusively established to cover Intellectual Property news, events and activities.

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NEW DELHI: Corporate India is in an innovation mode. And, it’s not IT companies, but manufacturing conglomerates that rule the roost, going by the maximum number of patents filed. That’s not all.

A SundayET analysis of the latest intellectual property rights (IPR) data has found that even two PSUs figure in the top 10 companies that filed maximum number of patents during 2006-07 and 2007-08. In fact, the number of patent applications in FY08 was 21% more than FY07.

Whereas India’s largest consumer products company Hindustan Unilever (HUL) filed 251 patents in the last two fiscals, pharma majors Ranbaxy and Cipla filed 208 and 53 patents, respectively, during the same period, the analysis has found out. Tata Steel filed 45 patents, and according to sources in the government, most of the Tata Motors’ 40 patents are connected to its Rs 1-lakh car Nano.

Among the top 100 tech companies in India, almost 89 have not filed any patent applications as yet. During FY07 and FY08, India’s top two exporters of software services TSC and Infosys Technologies filed 14 and 22 patents, respectively.

Corporate India’s growing interest in filing patents is a reflection of the country’s increasing economic and R&D activities and the realisation that new products are to be IPR-protected.

“The sheer number of patents being filed by India Inc is an indication that more and more innovations are taking place now. For some industries, filing patents may not be so important. ONGC, for example, filed just three patents in the last two fiscal years, and Reliance Industries filed just seven patent applications,” an official in the ministry of commerce and industry said.

Among Navratna companies, Bharat Heavy Electricals (BHEL) topped the list of filing patents with 36 applications, followed by Steel Authority of India (SAIL) with 23 and Indian Oil Corporation (IOC) with 10. Some of the Navratna companies, including National Thermal Power Corporation (NTPC), GAIL (India), MTNL, Power Finance Corporation (PFC) and Bharat Electronics, have not file a single patent in the last two fiscals.

In fact, during 2007-08, the government received 35,067 applications and granted 15,262 patents. Though India Inc has come forward to file more patents, the number of patents filed by prominent education and research organisations far exceed that of corporate India.

Whereas Council for Scientific and Industrial Research (CSIR) has toped the over-all list with 1,741 patents filed during FY07 and FY08, Indian Institute of Technology (IITs) stood second with 90, followed by Indian Council of Agriculture Research’s (ICAR) 27.

Monday, June 02, 2008

The last few years have witnessed substantial buoyancy in economic growth in emerging markets, especially India. A number of multinational companies, eyeing a piece of the India growth story, have undertaken transactions/ acquisitions which could directly or indirectly involve India-related assets. Media reports in the past have indicated that the revenue authorities are closely examining such transactions to ascertain whether appropriate Indian taxes have been paid on such transactions/acquisitions. In the context of a transaction executed by Foster’s Australia—a part of Foster’s Group Ltd—with SABMiller Plc., Foster’s Australia had approached the Authority for Advance Rulings (AAR) to seek determination of its tax liabilities in India owing to the transfer of Foster’s brand intellectual property, Foster’s trademarks and Foster’s brewing intellectual property.The relevant facts of the case before AAR are summarized below:Foster’s Australia, a leading international company engaged in brewing and marketing beer products, held a certificate of registration in India with respect to trademarks pertaining to the Foster’s brand. It had entered into a brewing licence agreement with Foster’s India Ltd, a Foster’s Group company. It had also granted Foster’s India an exclusive right to use the Foster’s trademarks in the territory of India. Subsequently, Foster’s and SABMiller executed an India sale and purchase (S&P) agreement which, inter alia, included the transfer of Foster’s brand intellectual property and trademarks to SABMiller in India. In addition, SABMiller was also granted an exclusive, perpetual and irrevocable licence of Foster’s brewing intellectual property in India by virtue of the S&P agreement. The S&P agreement was executed in Australia.Position unclearThe Income-tax Act, 1961, contains a deeming provision whereby certain income streams arising to non-residents (including foreign companies), directly or indirectly from a business connection, from any property in India, or transfer of a capital asset situated in India, would be subject to tax in India. The Act does not explain the circumstances under which capital assets such as trademarks, brands, etc., can be said to be situated in India. Hence, in what circumstances a property or an asset could be considered to be situated in India remained a vexed issue, especially in the case of trademarks and the like.The contention raised by Foster’s before AAR was that the transfer of trademarks and other intellectual property rights amount to transfer of capital assets and the situs, or where the property is treated as being located for legal purposes, of such assets was located outside India. Accordingly, the consideration thereof cannot be subject to tax in India.